Broadmeadows Homemaker Centre sold amid rising institutional interest in large format retail assets

Vicinity Centres has sold the Broadmeadows Homemaker Centre in Melbourne for $20 million on the heels of its recent $134.5 million sale of a 50% stake in the neighbouring Broadmeadows Central regional shopping centre.

CBREโ€™s James Douglas negotiated the homemaker centre sale to an undisclosed investor on a 7.0% yield.

The deal follows the June sale to Nikos Property Group of a 50% interest in Broadmeadows Central.

โ€œThe sale process for Broadmeadows Homemaker Centre was highly competitive, with investors attracted to the defensive tenant offering and the centreโ€™s landmark metropolitan site, 15km north-west of the Melbourne CBD in one of Australiaโ€™s fastest growing municipalities,โ€ Mr. Douglas said.

โ€œThe acquisition of the 3.4ha Broadmeadows Homemaker Centre site provides the purchaser with a significant freehold site and control of the large on-grade car park, which is able to accommodate 743 vehicles and provides future development opportunities.โ€

The centre has a gross lettable area of 5,631sqm and offers a mix of leading national and chain retailers. It is integrated with separately owned retail assets occupied by major retailers Harvey Norman, Dan Murphyโ€™s and Bunnings Warehouse.

Mr. Douglas said an increasing number of institutional buyers were turning their sights to large format retail (LFR) assets as strong population growth forecasts and a limited supply pipeline enhanced the sectorโ€™s prospects.

โ€œWhile private investors have traditionally dominated the purchases and ownership of LFR assets, over the past few years we have seen increased activity from institutional buyers such as REITโ€™s. This has been highlighted over the past year, when institutional buyers accounted for 49% of Australiaโ€™s LFR transactions compared to 29% of the purchasing activity in 2019,โ€ Mr. Douglas noted.

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